Matthew Wolniewicz, AIFA’s Post

The demand from #401k participants for in-plan guaranteed #retirementincome solutions is undeniable! J.P. Morgan Asset Management  2024 DC Plan Participant Survey " w 9/10 respondents expressing an interest for in-plan solutions that provide steady income in #retirement. Having a #guaranteedincome source was a key driver for participants to contribute more to their retirement, as only 43% said they were confident their retirement savings would last through their lifetime" “While it’s no surprise that participants seek retirement income support, it’s particularly noteworthy that guaranteed income options are highly attractive and can even motivate increased savings,” said Alexandra Nobile, Retirement Strategist at J.P. Morgan Asset Management. “Retirement plans continue to be a top priority for employees when evaluating employer benefits." When asked to choose what, aside from a salary increase, would help motivate them to contribute towards retirement, 35% said adding a guaranteed lifetime income option within the plan would incentivize savings, while another 35% said automatically increasing contributions by 1% a year, with the option of canceling the increases at any time, would help. Others said offering retirement income projections (31%) and providing a target amount on how much should already be saved (31%) would encourage them to save more. Amanda Umpierrez 401k Specialist Magazine Alyson Frost https://lnkd.in/g2chhnQz

Golden Years, Golden Advice For high earners seeking higher-end financial advisory, retirement planning must transcend basic strategies and delve into sophisticated, personalized solutions. Start by leveraging all available tax-advantaged accounts to their maximum potential, including 401(k)s, IRAs, and, if applicable, deferred compensation plans. Beyond these, consider establishing a Defined Benefit Plan or a Cash Balance Plan, which can provide significant tax benefits and allow for higher contribution limits tailored to your income bracket. These advanced retirement vehicles are especially advantageous for high earners looking to shelter substantial amounts of income while growing their retirement savings efficiently. Diversification is essential, but for high earners, it should include more than just a mix of stocks and bonds. Incorporate alternative investments such as private equity, real estate, hedge funds, and venture capital. These asset classes offer the potential for higher returns and provide a hedge against market volatility. A sophisticated financial advisor can help you navigate these complex investment landscapes, ensuring that your portfolio is not only diversified but also optimized for growth and stability. Additionally, explore international investments to further enhance diversification and capitalize on global opportunities. Healthcare and long-term care planning are critical components often overlooked in retirement strategies. High earners should consider purchasing comprehensive health and long-term care insurance to protect their assets from substantial healthcare costs that can erode retirement savings. This proactive approach will ensure that your retirement is not only secure but also aligned with your broader financial ambitions and legacy goals. It's time to embark on the journey of a lifetime.

Understanding Cost and Fee Transparency in Group Retirement Plans When it comes to planning for retirement, every dollar counts. One critical aspect that often goes unnoticed is the cost and fees associated with managing group retirement plans. Transparency in these costs and fees is not just a regulatory requirement; it’s a necessity for ensuring that employees maximize their retirement savings. Why Fee Transparency Matters Impact on Savings: Even small fees can significantly reduce the amount of money employees will have at retirement. Over time, seemingly minor fees can compound, leading to a substantial loss in potential earnings. Informed Decisions: When employees are aware of the fees they are paying, they can make more informed decisions about their retirement investments. This knowledge empowers them to choose options that offer better value and align with their financial goals. Accountability: Transparency holds plan administrators and service providers accountable. It ensures that they are providing services that justify their costs and are in the best interest of the plan participants. What to Look For Administrative Fees: These cover the cost of running the plan, including recordkeeping, customer service, and compliance with regulations. Investment Fees: These are fees related to the management of the plan’s investment options. They can include mutual fund expense ratios, management fees, and trading costs. Service Fees: Any additional services, such as loan processing or financial advisory services, may incur extra fees. Steps to Improve Transparency Regular Disclosures: Ensure that all fees are clearly disclosed to participants on a regular basis. This includes detailed breakdowns of what each fee is for. Education: Provide resources and education to help employees understand how fees affect their retirement savings and what they can do to minimize these costs. Comparative Analysis: Encourage employees to compare the fees of different investment options within the plan. Highlighting low-cost options can lead to better retirement outcomes. Final Thoughts Cost and fee transparency is not just about compliance; it’s about building trust and helping employees achieve a secure financial future. By prioritizing transparency, employers can demonstrate their commitment to their employees’ financial well-being and ensure that the benefits of group retirement plans are fully realized.

🔍 What Time is the Right Time? Finding the Optimal Entry for Your Clients’ Golden Years Deciding when to retire is a profound financial decision — and finding the right answers for varied client segments involves scenario planning, prioritization of retirement goals, and balancing financial readiness with emotional preparation. Mike Kurz, CIMA®, CPWA®, RMA®, CFP®, CAIA, and Director of Programs at the Investments & Wealth Institute, recently shared his wisdom on helping clients navigate this complex journey in "How Advisors Can Help Clients Determine the Right Time to Retire," published by @InvestmentNews. As the financial advice industry continues to evolve towards fully personalized and holistic planning, Mike touches on several key needs for today’s exceptional retirement advisors. 📊 Incorporating Digital Tools: Retirement calculators and other financial planning tools are highlighted as core tools for assessing retirement readiness — which not only aid in more realistic financial projections but enhance client engagement by making the planning process more interactive. Read the full article for hyperlinked examples. 🔄 Addressing Diverse Client Segments: Retirement planning varies significantly among clients. Those with substantial assets can focus on optimizing income streams, while others may need to work beyond the traditional retirement age due to insufficient savings. Most clients, known as "Potential Pivoters," have some savings, but require a flexible approach to balance their aspirations with their financial realities. It is no coincidence that Mike plays an integral role in maintaining the Investments & Wealth Institute’s Retirement Management Advisor® (RMA®) certification program, which equips advisors with the advanced skills needed to manage the complexities of retirement planning. Covering both technical and emotional aspects of the retirement process, the RMA program helps advisors provide tailored, comprehensive solutions for diverse client needs, ensuring they are well-prepared for all stages of retirement. 🎓✨ Read the full article at: https://lnkd.in/gpR_XJMB #InvestmentsandWealthInstitute #RetirementPlanning #FinancialAdvisors #ClientEngagement #RMAcertification

THE NEED FOR RETIREMENT PLANNING For much of the 20th century “retirement” was traditionally defined in terms of an individuals relationship to their participation in the active workforce. More recently, however, many individuals are beginning to recognize that for several reasons, this “traditional” view of retirement is no longer accurate. The single most important factor in this changed retirement picture is the fact that we are now living much longer than before. Planning for a much longer life span involves addressing problems not faced by earlier generations. Some of the key issues to be considered include: --Paying for Retirement: Longer life spans raise the issue of providing a steady stream of income. Social Security and personal savings such as a 401(k) may not be enough. --Health Care: Medicare benefits are generally considered to be the minimum “foundation” of a retirement health care plan. Often a supplemental “Medigap” policy is needed as well as a plan to provide for long term care to provide benefits not available through Medicare. --Estate Planning: Retirement planning inevitably must consider what happens to an individual’s assets at death. The estate plan should ensure not only that the assets are transferred to the individuals or organizations chosen by the individual, but also transfer in the most tax efficient way. --Housing: Housing involves not only the size and type of home (condo, house, assisted living) but also its location. Factors such as climate and proximity to family and quality medical care are often important. --Lifestyle: Some individuals, accustomed to a busy work life, find it difficult to enjoy the freedom offered by retirement. Planning can make this transition easier. Developing a successful retirement plan involves carefully considering a wide range of issues and potential challenges and obstacles. Seeking professional advice is often a wise choice to finding the solutions to these questions. Please contact us at your convenience as we stand ready to assist you in addressing these challenges and answering these questions.  

🚨 Are Middle-Class Workers Falling Short on Retirement Savings?🚨 As a Certified Wealth Educator & REALTOR®, I hear from so many hard-working Americans who are worried about retirement—and the numbers show they have every reason to be. A recent report reveals a troubling reality: the majority of middle-class workers fear they won’t have enough saved to maintain their current lifestyle in retirement. Even with stable jobs, consistent 401(k) contributions, and good financial habits, many are finding that traditional retirement plans might not cut it anymore. Rising living costs, longer lifespans, and unexpected medical expenses are all making retirement more costly than ever. The fear of outliving savings is real—and it's something we need to talk about openly. Traditional Retirement Planning Challenge Middle-class earners often face a conundrum: You’re doing all the "right" things-contributing to your 401(k), managing debt, and saving diligently—but it feels like it might not be enough. The volatility of the stock market adds another layer of uncertainty. While market growth can be great, relying solely on it can be risky. One significant downturn could jeopardize years of hard-earned savings. Power of Supplemental Income Streams Here’s the silver lining: You don't have to depend solely on traditional savings or stock market performance to ensure a comfortable retirement. In fact, creating multiple streams of income can be a game-changer for financial security. And no, this doesn’t mean leaving your corporate job or abandoning your entrepreneurial venture. It means diversifying and building on what you already have. 🔑 Real estate investments, for instance, can offer steady, passive income and long-term value appreciation.  🔑 Side hustles that align with your skills or interests can provide extra income without requiring a complete career shift. 🔑 Financial education roles or consulting can utilize your expertise while adding another revenue stream to your portfolio. Why Diversifying Income is Crucial Now More Than Ever Starting early with these strategies can set you up for a more secure and flexible future. It’s all about making smart, strategic moves that minimize risk while maximizing potential. Whether you’re 10, 20, or even 30 years away from retirement, there are options available to create a customized plan that aligns with your goals and lifestyle. Let’s Chat About Securing Your Financial Future If you’re looking for ways to supplement your income w/out compromising what you’ve already built with your career or business, let’s have a convo. I’m passionate about helping professionals like you create a financial safety net that not only protects your present but also secures your future. 💬 Send me a message here or give me a call at 470-348-8284. Let’s work together to develop a personalized strategy that ensures you don’t just survive retirement—you thrive! Remember, it’s not just about working hard; it’s about working smart. 

An unsurprising common theme running through many of the submissions made to Treasury on its retirement consultation is the need for more accessible, open and timely availability and sharing of data relevant to a person’s or a household’s financial and related circumstances to better discern and inform their broader retirement positioning, objectives and options. The accumulation side of our retirement system is world class, predicated on the utility and proven positive outcomes generated by a combination of our SG and for many the application of quality defaults. However, when it comes to the retirement phase, there’s more to do. Unlike accumulating savings towards retirement, retirement itself is genuinely unique to a person or household. Like a fingerprint, no two are the same. In order to rise to the challenge and opportunity to be as world leading in the retirement phase, we need to reduce or remove the current inefficiencies, uncertainties, friction and unnecessary customer effort from this. Effectively, we need to adopt an open banking mindset and approach to harness and leverage data insights to help optimise retirement outcomes. And regulators need to play a role here too. Rather than critiquing funds’ lack of pace, progress and innovation in their evolving retirement income strategies, the regulators can and should be lending their voices and influence to having better system ‘plumbing and wiring’ to support funds to help their members with better guidance, pathways, nudges and solutions, as economically and efficiently as possible. And if not now, or soon, then when?

comfortable retirement Setting aside 15% of your annual salary before taxes is a good place for many people to start Keys to success: ‘Start early and save often’ How much money you should save for a comfortable retirement keys to general success for retirement, experts said. “Start early and save often,” Chao said. “That’s the main thing.” This helps build a savings habit and gives more time for investments to grow, experts said. “If you can’t save 15%, then save 5%, save whatever you can — even 1% — so you get in the habit of knowing you need to put money away,” Blanchett said. “Start when you can, where you can.” Every time you get a raise, save at least a portion instead of spending it all. Blanchett recommends setting aside at least a quarter of each raise. Otherwise, your savings rate will lag your more expensive lifestyle. Many people invest too conservatively, Chao said. Investors need an adequate mix of assets such as stocks and bonds to ensure investments grow adequately over decades. Target-date funds aren’t optimal for everyone, but provide a “pretty good” asset allocation for most savers, Blanchett said. Save for retirement in a tax-advantaged account like a 401(k) plan or an individual retirement account, rather than a taxable brokerage account, if possible. The latter will generally erode more savings due to taxes, Blanchett said. Delaying retirement is “the silver bullet” to make your retirement savings last longer, Blanchett said. One caution: Workers can’t always count on this option being available. Don’t forget about “vesting” rules for your 401(k) match. You may not be entitled to that money until after a few years of service. Key Points ·        There isn’t a magic number for retirement savings. Setting aside 15% of your annual salary before taxes is a good place for many people to start, experts said. ·        Starting early is key, even if it’s just a small amount. Those who start later will have to boost their savings rate. ·        Invest in a tax-advantaged account like a 401(k) plan or an individual retirement account and make sure your asset allocation isn’t too conservative relative to your age. Many Americans are anxious and confused when it comes to saving for retirement. One of those pain points: How much should households be setting aside to give themselves a good chance at financial security in older age? More than half of Americans lack confidence in their ability to retire when they want and to sustain a comfortable life, according to a 2024 poll by the Bipartisan Policy Center. It’s easy to see why people are unsure of themselves: Retirement savings is an inexact science. “It’s really a hard question to answer,” said Philip Chao, a certified financial planner and founder of Experiential Wealth, based in Cabin John, Maryland. “Everyone’s answer is different,” Chao said. “There is no magic number.” Why?

Elston launched its #rethinkingretirement campaign back in August 2015, so we are glad to see BlackRock also emphasising that it's time to "rethink retirement". We 100% agree. We launched our #rethinkingretirement campaign following UK Pensions Freedom, as part of a project rolling out Target Date Funds for the UK retail market in conjunction with Architas (Now AXA IM Select) and AllianceBernstein. Here's my article from back then. I am glad to say its contents still holds true today. This original thesis supported 1) work for we did for one of our DFM clients to launch their Retirement Income portfolios in 2018, 2) our work with interactive investor to launch their #RetirementPathways and participation in that consultation 2018-20, 3) the design of the Elston Retirement Income MPS solution for UK advisers which celebrated their 3 year anniversary on 31st March 2024 (advisers - please DM me for more info); 4) our Annuity Glidepath unveiled in 2023 with data from Billy Burrows; and 5) our feedback to the FCA's Retirement Income Advice Thematic Review. And it won't stop there... So you can imagine my delight (and wry smile) when BlackRock put retirement investing front and centre of the challenges they are also trying to solve under the campaign led by Larry Fink "It's time to rethink retirement". We couldn't agree more! And we look forward to continuing our work to research, design and develop innovative investment solutions for the UK advisers both independently and in conjunction with leading institutional providers. #rethinkingretirement #elston #multiasset #investmentsolutions Elston Consulting Hoshang Daroga, CFA Scott Adams

Retirement Plan Best Practices ·      Many companies match employee contributions made to retirement plans (to a certain percentage of annual pay). A 25% match to 3% of income, for example, equates to a guaranteed annual return of 25% on one’s investment before the money even gets invested. Contributing less than 3% of one’s pay in this example is synonymous with special requesting a pay reduction from the boss! ·      The tax advantages of employer-sponsored retirement plans can exceed other investment options, especially for high income households, due to their high contribution limits*. Have a fiduciary advisor, in an advisory relationship, work with your CPA to find a smart mix of traditional, Roth, and taxable contributions based on your own long-term financial plan. ·      The structure of employer-sponsored retirement plans lends itself to dollar-cost averaging, which forces participants to purchase more shares of a given fund when the price is low, and fewer shares when the price is high. ·      Employer-sponsored retirement plans generally offer competitive, low-expense index funds. Every dollar of expense comes straight off an investor’s rate of return, and worse, is compounded indefinitely into the future! Consider also the following issues regarding your employer-sponsored retirement plan accounts: ·      Taking a loan on these accounts is generally inadvisable for several reasons. Loan repayments are usually reinvested at a higher price. The rollover option can become jeopardized. A plan termination can force loan repayment, which, if made from the account by a participant under age 59 ½, becomes penalized. ·      Keep your beneficiaries updated, which avoids the unnecessary delay of probate, dodges threats to the tax advantages available, and allows an immediate, tax-deferred distribution to beneficiaries. ·      Understand your personal investment objective and risk tolerance, and maintain an asset allocation reflective of these at all times. New regulations allow your fiduciary advisor, in an advisory relationship, to professionally manage your active retirement plan accounts for a modest fee. These and other features make the employer-sponsored retirement plan a fantastic option for a significant portion of your total retirement savings. Be sure to make the most of it, and may your efforts to be both physically and financially healthy be blessed! Shaun